Facebook now lets ads target you based on what you do outside Facebook

While Facebook has always been great at providing specific demographics to advertisers, it has struggled with helping advertisers target demand: the people most likely to be in the market for their product. That’s been Google’s forte, and it’s the reason the search engine is worth $260 billion and the social network is worth $60 billion.

But Facebook is looking to change that.

Today Facebook launched a new self-serve advertising product, partner categories, which will allow advertisers to target specific categories of people based on what they actually buy and want to buy, both online and offline.

The new product mixes Facebook’s own personal data with information from third-party consumer segmentation and data companies such as Datalogix, Epsilon, and Acxiom to identify people who are in the market for certain products, and deliver those people in an anonymized group to advertisers:

The new targeting mechanism is available today for U.S. advertisers in the Facebook’s Power Editor, which helps advertisers manage large numbers of ads, and includes more than 500 unique categories of consumers. Advertisers can also take these groups and fine-tune the exact audience they want with Facebook’s other targeting options, meaning that you can now layer a demographic slice with a demand slice and get a very fine-grained target sample for exactly your defined customer base.

The offline part is key.

Partner Categories “allows brands to reach groups of people based on interests they have expressed and actions they have taken off of Facebook,” one of the new ad partners, Epsilon, said in a statement.

Epsilon is an old-school data company started in 1969 that leverages transactional data (sales) and database marketing to help advertisers target. It’s joined by Acxiom, a 40-year-old company that has been big in database marketing but also enables over a trillion digital data transactions a week, and Datalogix, another company that started in the pre-digital, pre-social world of marketing. Other companies may yet be added, as Facebook notes.

The real question is, although these companies have all invested heavily in digital technologies for the modern age, how good are they at targeting demand compared to Google, which has the best consumer insights platform in the world: a search engine that is constantly learning what people want. My guess is: in some things like consumer packaged goods, better. And in other things that have largely migrated online, like electronics and big-ticket items, not so much.

In any case, it’s an interesting combination of online and offline data to understand the whole consumer, as Epsilon EVP Eric Stein says:

“There is a tremendous opportunity for marketers to leverage offline data to reach their customers and prospective customers where and when they are deeply engaged.”

The objective, according to Facebook, is better ads, more relevant ads — ads, in fact, that are as interesting as the original reason you came to Facebook.

“Our ultimate goal is to make the ads people see on Facebook as relevant as the information they see from their friends,” Facebook director Yvette Lui said in a statement.